Category Archives: Self-Interest

Before I get to far, there is a great opinion piece about the government’s role in the sub-prime mortgage crisis and how this led to the Occupy Wall Street movement in the Wall Street Journal this morning.

My real concern, as I state at the top, is the question about what is greed? Is it a bad thing? Are all forms of self-interest necessarily a bad thing? In the popular media, moralizing abounds about people being greedy and only looking out for themselves. Usually, it is CEOs, bankers, businessmen, pretty much anybody involved in finance or business broadly. I started thinking about this while listening to this radio show from Here and Now on NPR. The main guest Mr. Ron Hira, calls out the heads of Microsoft and other IT companies for being “greedy” and “only looking out for their own self-interest.” The entire show is about older IT workers who can’t get jobs, while at the same time, IT companies are looking for relaxed immigration regulations to higher new workers. The story is mildly interesting but the whole time I was thinking, “the IT workers are looking out for their own self-interest too.”
It seems to me that this is a classic case of people using ethics as a will to power. Of course the IT workers are looking out for their own self-interest. They need work. But, it is not correct to say that the only ones looking out for their own self-interest are the CEOs. I am trying here to clarify some terms. On the popular level, greed means something like “wanting any amount of money more than I say you can have.” I should think we could do a little better. I am proposing something like greed meaning, “wanting an excessive amount of money or wealth.” Excessive being the key term that would be difficult to pin down. The old IT worker would be immune from being called greedy simply because he does not have a good enough job (he is a janitor) and wants to work in IT because at one point in his life he was qualified. The CEO, who already has a high paying job, wants cheaper, younger, better trained employees so his/her company can run more efficiently to maker more money is the greedy one.*
*I guess at this point, we should say that because this show was on an American radio station, and presumably most of the listeners are Americans, that we should not be concerned with Indians being able to get work that they are qualified for.
I guess I am just wondering do we really expect people not to act in their own self-interest? Maybe there is a better way to frame this discussion such that we do not just resort to amateurish moralizing in order to get the upper hand in a debate.
I guess I can’t get away from my academic days, so I like a lot of citing. I recently read a great piece by Michael Lewis on the problems in California government, focusing on the local level. He writes, “Alone in a dark room with a pile of money, Americans knew exactly what they wanted to do, from the top of the society to the bottom. They’d been conditioned to grab as much as they could, without thinking about the long-term consequences. Afterward, the people on Wall Street would privately bemoan the low morals of the American people who walked away from their subprime loans, and the American people would express outrage at the Wall Street people who paid themselves a fortune to design the bad loans.”
So, I am circling back to Occupy Wall Street and the IT workers. We are all grabbing as much as we can. We are all self-interested. Let’s not deny that this is the case. What we need to do is find a way to be for our own self-interest while also looking out for the self-interests of others. The mad grabbing and name calling will not work out in the end. I think that there is some kind of “selfishness” that is a bad thing. But, it has to be more than just looking out for your own self-interest because that is unavoidable. Selfishness has to go deeper and more insidious. Selfishness must me grabbing so that no one else can have any and totally denying that my grabbing won’t have larger social implications or caring about those larger social implications.
I have said much about selfishness without bringing it into the theological or religious arena. Some must be wondering, “where is the Scripture quoting and theological language about selfishness?” That is where we get the idea that selfishness is bad isn’t it? Scripture? Certainly, it is. Much of the discussion of selfishness and money comes form Jesus himself. In the Sermon on the Mount in Matthew 6, Jesus says, “No one can serve two masters, for either he will hate the one and love the other, or he will be devoted to the one and despise the other. You cannot serve God and money.” Moreover, you do not need a prooftext to realize that the purpose of Jesus life was to lay down his life humankind. This example is clear, we should not just look out for ourselves. While, I am not going to exegete all of this, I think that the interesting part in the whole discussion is just before the previously quoted verse. Jesus discusses storing up for yourselves “treasures in heaven.” Jesus does not spell out exactly what he has in mind. However, it is clear that Jesus knows that incentive drives behavior. He does not say, “do not seek out treasure or reward, or any self-interest.” He wants us to have self-interest. Not self-interest that grabs at the complete expense of others. Self-interest that looks out for the interest of others. In the broader context, the Sermon on the Mount is primarily about looking out for other people. This is probably what Jesus has in mind for treasures in heaven, although it is not made explicit.
I think that Paul sums it up nicely when he writes, Phillipians 2:4 – “Let each of you look not only to his own interests, but also to the interests of others.” What I am arguing for is really nothing new. I am not saying St. Paul could have foreseen what is going on in today’s society, but the injunction seems particularly apropos. And, let’s be clear. The people who have failed to look out for the interest of others, are NOT just Wall Street bankers or CEOs. People signed up for the mortgages that they should have known they could not pay for. Our ENTIRE society is at fault for what is going on here and it will take much more cooperation to rebuild it then what I have seen is going on.
Sorry that was so long. Bonbons for those who finished! Although I doubt there were any! Let me know if you did!

“The Psychological view of politics is that you can change peoples minds…the economist says that [a person’s] positions are fixed.” This is a quote from a recent podcast done by Planet Money. This being a blog that discusses primarily economics and theology I wondered how I would describe the way in which theology views politics, or more precisely the idea that one can or can’t change anything, most importantly their mind.

There are several ways to describe broadly a theological view of change. On the one hand, religion and religious groups tend to be inherently conservative organization. My favorite example from a Jewish professor I had was the tzitzit that are worn under the garments of Orthodox Jews. He tells how this was ancient Babylonian part of general clothing that was worn by Jews in that day and then continued to be worn because of infused theological significance. His example came from the Medieval Kabbalists who infused supernatural significance to everything. Nevertheless, religious groups tend to resist change. It took until 1960 for the Catholic Church to start using the vernacular instead of Latin in Church services (although I am sure if Lamin Sanneh read this book he would be quick to point out that the Catholic Church did allow some vernacular in the Slavic countries and in certain parts of the liturgy. Read: Translating the Message. No really, read it. Its great). You might think that the New Testament is a form of Christians being willing to change and try something different, but that is only partly true. Jesus never claimed to found a new religion. In fact, he said in Matthew that not even a jot or a tittle has been removed from the law. When his later followers were forced by circumstance to separate themselves from the 2nd Century Jews around the time of Simon Bar Kochba, they still kept the Hebrew Scriptures because in order for their religion to feel it had some legitimacy they had to connect it to something ancient. This still occurs in our day, look at the Latter Day Saints. They didn’t want to just totally reinvent the wheel (which they did in a lot of ways) so they connected themselves to Christianity and the Bible of the Old and New Testaments and then added on a bunch of laws in the Doctrine and Covenants and created something in many ways extremely different from their protestant predecessors.

You could continue to pile on theological examples like the idea of Original Sin or as Dutch Calvinists would add, the Total Depravity of Man (they wouldn’t have been politically correct enough to say “humanity”). Basically, humanity was born into a state of sin and this came from Adam that has affected every single human person born. But, this is also precisely where it is difficult to say whether, in Christian theology at least, theology believes that change is possible. It is in this very notion of original sin that Christians believe that people can change. Metanoia is the Greek word that is often translated repent. It is used throughout the Gospels and the Epistles and it means to precisely change ones mind. It is the bedrock for the Christian idea of conversion. Many people outside the Church and the religious pluralists tend to believe that religion is based solely on the country you came from. If you are from the West, you are a Christian because that is how you were raised. Or, if you were raised in Iran you are Muslim because that is how you were raised. Logically, these are patently flawed arguments but people tend to believe that religion is extremely static. But that notion belies the very foundation of Christian theology at its core. People can and should change.

The mantra of the Reformers of the 16th century was semper reformanda. Always reforming. The protestant church has an extremely hard time with this as an institution. As a large group, we always tend to try and regress towards the old ways. What was, is better. But on the individual level, we must believe that change is possible. It is the difficulty of a large group mentality over and against what occurs at the small group level. I think it is instructive that Jesus spoke very little about establishing the Church as a large institution. Institutions struggle to adapt to their situations.

Let’s bring this back to the podcast. Steven Smith in the podcast discusses this book, Manser Olsen – Logic of Collective Action, which I have never read. But, he talks about a footnote where it states that even an economist can recognize that change can occur when people get together in small groups to discuss what ever issue is at and. What a powerful notion! I find it difficult to deny the logic of incentive driving behavior and the selfishness and stubborn behavior that is evident in studying large groups of people. But for some reason, when people stand face to face minds can be changed. If anyone has read Immanuel Levinas, this is nothing new. He spoke frequently about the “face of the Other.” What a challenge this is from economics to theology. If even the seemingly steadfast rules of incentive can be broken when people gather together as individuals to listen, minds can be changed! Jesus also says something like this when he says, “when two or three are gathered together in my name, there am I with them.” Christ encourages people to gather together because there is power in these kinds of gatherings. What is interesting about that quote from Jesus is that it comes at the tail end of a discussion of what to do when people disagree within the Church! The podcast I have referenced at the top is talking about Congress creating a smaller group to deal with what is at issue in the larger body. Small groups can change minds.

I was working on a post about jobs, but I still can’t figure out what I want to say. I am going to go watch the Cards hopefully beat the Braves.

As the economy continues to sputter and estimates continue to be revised, one man seems to be able to stir up the media and the web 2.0 world. That man, the “Oracle of Omaha,” “the Woodstock of Capitalism”, Warren Buffett.
Yesterday, as many of you have probably heard, Buffett’s Berkshire Hathaway will invest $5 billion in Bank of America, rising the stock of BoA nearly 25%. As the Bloomberg article relates in the previous link, this is of course not the first time Buffett has made major investments in companies and made huge returns. In the middle of the mortgage crisis, Buffett made a $5 billion investment in Goldman Sachs and made a sweet little return of $1.7 billion.
Buffett also made news in the last few weeks by his seemingly strange challenge to Congress, “Buffett said the rich are “coddled” by Congress “as if we were spotted owls or some other endangered species. While the poor and middle class fight for us in Afghanistan, and while most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks,” Buffett wrote in a Sunday New York Times Op-ed.” Liberals cheered everywhere on my Facebook news feed. This is one area where the Sage of St. Louis, or my dad, and Buffett part ways. But, be that as it may…
Why I am bringing this up? When is the last time in history one man has had so much power? One investment, one statement, and the world pays total attention. Of course, through history, there have been many men, and women, of power who usually assert their strength through military might, i.e. Alexander the Great, Julius Caesar, Napoleon, Hitler etc. Their have been men who have had great ideas that in the long term have changed the course of Western history, Socrates, Plato, Jesus, Muhammad, etc. But, what makes Buffett so incredible is the age that he lives in allows him to change multi billion dollar corporations in one quick moment. Some of these corporations are the very ones that in the past have been deemed “too big to fail,” for the good of the rest of the country and by relation the world. If America goes down, so does China, so does Europe and on and on. We have seen this domino effect in full force over the length of this recession (which looks like it is moving towards a double dip). Americans often pride themselves on their individualism and their belief that their actions effect only themselves. This is the way we talk about our ethics. “I am going to do what’s right for me.” Or, “I need to do what I need to do.” Granted, Buffett is in a pretty special role, and that is why I brought him up. He seems to have a unique interconnectedness to the world. But, through our decisions we have given people like him that power. We continue to be dependent on large banks and the government to provide credit for our schooling and our mortgages. Especially Americans have banked on the idea that credit is good in all cases and we are beginning to see that this might not be the best long term perspective.
This is a crucial intersection to me of theology and economics. People like Warren Buffett make decisions that will effect the entire country. I am actually somewhat comfortable with Buffett at that helm. Freakonomics has run a podcast about the way Buffett raised his children and seems to be an extremely ethical and conscientious person. Paul in the New Testament writes, “each of you should look not only into your own interests but also to the interests of others.” The whole Levitical legal code in the Hebrew Bible was given in order for them to live together and live well as a community. The 7 year jubilee and many other laws depict a community that is looking out for all people who will be effected. The problem with the American mentality is that we don’t think like a community. We think like individuals. Our perspectives are too often about instant gratification for ourselves and not up the impending disaster that will come not only to others but us too. I am not saying we are always going to act altruistically or without some self-interest. We have to act in some way with a delayed self-interest but it has to be in a larger community self-interest. What happens to us a people at large, will ultimately effect us as individuals. My dad often says, “a rising tide sinks all ships.” This delayed self-interest has to be able to think beyond what feels good at the moment, despite the difficulty that ensues. Another one of my favorite podcasts, not related to economics, is Radiolab from WNYC. They did a show about the difficulty of forcing that part of ourselves that only seeks instant fulfillment at the expense of long term health.
So what am I arguing for? Economics looks primarily at incentive. I am thankful that Warren Buffett’s incentives are to make money, but he is also concerned about the good of the community he is looking in. I am holding him up as an example, for Americans to consider how their actions although seemingly only effecting themselves have a much larger impact. And this large impact will in some cases turn back on them. I think that theology and ethics should guide the interests that Economics studies. But these interests should be long view interests. Not immediate self-gratifying ones. Thoughts? Please make a comment! I might be totally wrong.